Click to play videoNew Delhi: The auto industry is facing the heat because of global economic slowdown and its effect on India. Now the industry is doling out discounts to lure customers.
In spite of the festive season in October, auto sales dropped by almost five per cent and the industry is bracing itself for tougher times.
November figure expected next week maybe pretty dismal. So in order to clear the inventory, auto companies like Maruti Suzuki, Tata Motors, Hyundai, Ford, Honda, General Motors are being forced to offer discounts.
"Most companies are offering discounts. In addition to the discounts now people have huge inventories, so they are giving discounts like never before," points out Dilip Chenoy, Director General, Society of Indian Automobile Association (SIAM).
Honda was the first one to slash the prices. In November it cut the price of its Civic Hybrid by almost Rs 8.14 lakh, resulting in record sales. And the company is not alone.
Ford has recently announced a Rs 91,000 cut in the price of the EXI petrol variant Fiesta, bringing its ex-showroom price down to Rs 5.29 lakh.
It has also announced an equally substantial cut of Rs 51,000 on the diesel variant, but the offer is only for the next 10 days.
Hyundai's current discount offering includes a free insurance on the Santro (roughly worth Rs 12,000 and Rs 5,000 off on the i10.
Hyundai is also offering its 1998 flagship model Santro GL for as little as Rs 3 lakh, its introductory price 10 year ago.
"We have host of different schemes on every model because we firmly believe that customer is looking for good discount especially in the month of December," says Arvind Saxena, VP, Sales and Maketing, Hyundai Motor India.
Maruti is offering discount of uptp Rs Rs 35,000 on the WagonR and Rs 15, 000 on the Alto.
But there are no discounts on the Swift Diesel and Dzire.
Tata Motors has hiked its discount offer on the Indica by Rs 5,000 to Rs 30,000 and on the Indigo (excluding the CS range) by Rs 15,000 to Rs 40,000.
On the Sumo Grande utility vehicle, it is now offering discount of Rs 65,000 against a rebate of Rs 14,000 on insurance previously.
General Motors too continues a Rs 58,000 discount on the Spark and Rs 53,000 on the Aveo Sedan.
But the question still remains and most analysts say that the low sentiment of the recession, the fear of job loss, salary cuts and, most importantly, financial crunch may not bring back sales as expected.
(For updates you can share with your friends, follow IBNLive on Facebook, Twitter and Google+)
displayed with permission. Use of the CNN name and/or logo on or as part of CNN-IBN does not derogate from the intellectual property rights of Cable News Network in respect of them.